The ups and downs of betting on gambling firms

Investing in gambling companies provides as many thrills and spills as the Cheltenham Festival races, which about 250,000 people are expected to watch this weekTIM GOODE/PA

As the 250,000 punters attending the Cheltenham Festival this week know only too well, gambling can be a mug’s game, subject to fluctuating fortunes.

Long-standing shareholders of Sportech, the betting and gaming technology group, will know how those punters feel, having experienced many ups and downs. During an eight-year legal battle with the taxman over a £97 million VAT refund on its Spot the Ball game, various tribunals and courts handed victory to one side then the other before declaring Sportech the winner. Its subsequent sale of the Football Pools business put another £83 million in its coffers and last year it handed £75 million back to contented shareholders. There was the promise of more winnings when it announced a strategic review that was expected…